How to open a New Jersey Cultivation License in 2022
After years of medical cannabis, in 2021 three bills were signed into law, legalizing recreational cannabis businesses in the Garden State. The new jersey public question permitting and regulating the use of recreational marijuana passed at the ballot box, then the legislature created an adult use license structure to prioritize municipalities negatively impacted by the war on drugs in New Jersey. The law created a cannabis regulatory commission to govern legal cultivation and sales of New Jersey cannabis, created a new set of state sales tax laws, and came up with different ways to prioritize conditional licenses that benefit small businesses, locals, disabled veterans and social equity applicants.
Right now it’s not possible to buy recreational cannabis anywhere in New Jersey, however, experts say it will be months before the first legal cannabis sale will take place in New Jersey.
So, now it’s the perfect time to start preparing for the endeavor. Take into consideration that the licensing application can be tricky and confusing, that’s why you should always contact a professional to help you with your application. Social Equity & Diversely owned businesses that apply for a conditional license and have local approval will be the license applicants that walk away with the license to sell marijuana in NJ.
How much does a New Jersey Cultivation License Cost?
A Class 1 Cultivator License is a legal document that allows its owner to grow, cultivate, or produce cannabis in the state of New Jersey, as well as sell and transport this cannabis to other cannabis cultivators, or usable cannabis to cannabis manufacturers, cannabis wholesalers or cannabis retailers but not to consumers. The license fees are as follows:
| APPLICATION & CERTIFICATION FEES | ||||
| Conditional License Applicant | Annual License Applicant | |||
| Standard Business | Microbusiness | Standard Business | Microbusiness | |
| Application Submission Fee | $200 | $100 | $400 | $200 |
| ApprovalFee | $800 | $400 | $1,600 | $800 |
| Conditional Conversion Submission Fee | $200 | $100 | n/a | n/a |
| Conditional Conversion Approval Fee | $800 | $400 | ||
These are by no means the only costs to opening your cannabis cultivation facility, just the tip of the iceberg. We have heard reports of consultants charging over $75,000 for completing the entire 150 page application required by New Jersey to obtain your Annual Cannabis License. Plus, the cities have been requiring very high application fees as well.
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A cannabis Cultivation License shall be issued by the Cannabis Regulatory Commission (CRC) for the premises at which the cannabis is grown or cultivated. Some areas of the state are labeled as impact zones that suffered past marijuana enforcement activity, they will receive benefits in their license applications. After budgeting tens of thousands of dollars for your application process. You will need hundreds of thousands of dollars to provide the down payment money to access financing for construction of your facility and enough funds to keep your operation going until harvest money starts rolling in. Many teams do not have a reasonable budget, but we can help you understand what you need to spend and how you can get financing.
How to apply for a Cultivation License in NJ
In order to apply for a Class 1 Cultivation License, the applicant must:
- Apply for a license in the manner described in the latest legislation and the CRC;
- Have at least one significantly involved person who has resided in this State for at least two years as of the date of the application, and provide proof that this person and any other person with financial interest who also has decision making authority for the cultivator listed on an application submitted under the legislation is 21 years of age or older;
- Meet the requirements of any rule or regulation adopted by the CRC;
- Provide for each of the following persons to undergo a criminal history record background check: any owner, other than an owner who holds less than a five percent investment interest in the cultivator or who is a member of a group that holds less than a 20 percent investment interest in the cultivator and no member of that group holds more than a five percent interest in the total group investment, and who lacks the authority to make controlling decisions regarding the cultivator’s operations; any director; any officer; and any employee.
Much like the medical marijuana applications before legalization an initial application for licensure shall be evaluated according to criteria to be developed by the cannabis regulatory commission. There shall be included bonus points for applicants who are residents of New Jersey. The criteria to be developed by the cannabis regulatory commission shall include an analysis of the applicant’s operating plan, excluding safety and security criteria. The applicant’s operating plan has to include a description concerning the applicant’s qualifications for, experience in, and knowledge of each of the following topics:
Cultivation of cannabis is
Conventional horticulture or agriculture, familiarity with good agricultural practices, and any relevant certifications or degrees;
Quality control and quality assurance;
Recall plans;
Packaging and labeling;
Inventory control and tracking software or systems for the production of personal use cannabis;
Analytical chemistry and testing of cannabis;
Water management practices;
Odor mitigation practices;
Onsite and offsite recordkeeping;-strain variety and plant genetics;
Pest control and disease management practices, including plans for the use of pesticides, nutrients, and additives;
Waste disposal plans; and
Compliance with applicable laws and regulations.
Furthermore, the criteria to be developed by the CRC has to include an analysis of the following factors:
The applicant’s environmental impact plan.
A summary of the applicant’s safety and security plans and procedures, which shall include descriptions of the following:
Plans for the use of security personnel, including contractors;
The experience or qualifications of security personnel and proposed contractors;
Security and surveillance features, including descriptions of any alarm systems, video surveillance systems, and access and visitor management systems, along with drawings identifying the proposed locations for surveillance cameras and other security features;
Plans for the storage of cannabis and cannabis items, including any safes, vaults, and climate control systems that will be utilized for this purpose;
A diversion prevention plan;
An emergency management plan;
Procedures for screening, monitoring, and performing criminal history record background checks of employees;
Cybersecurity procedures;
Workplace safety plans and the applicant’s familiarity with federal Occupational Safety and Health Administration regulations;
The applicant’s history of workers’ compensation claims and safety assessments;
Procedures for reporting adverse events; and
A sanitation practices plan.
A summary of the applicant’s business experience, including the following, if applicable:
The applicant’s experience operating businesses in highly regulated industries;
The applicant’s experience in operating cannabis establishments or alternative treatment centers and related cannabis production, manufacturing, warehousing, or retail entities, or experience in operating cannabis distributors or delivery services, under the laws of New Jersey or any other state or jurisdiction within the United States; and
The applicant’s plan to comply with and mitigate the effects of 26 U.S.C. s.280E on cannabis businesses, and for evidence that the applicant is not in arrears with respect to any tax obligation to the State.
A description of the proposed location for the applicant’s site, including the following, if applicable:
The proposed location, the surrounding area, and the suitability or advantages of the proposed location, along with a floor plan and optional renderings or architectural or engineering plans;
The submission of zoning approvals for the proposed location, which shall consist of a letter or affidavit from appropriate officials of the municipality that the location will conform to local zoning requirements allowing for activities related to the operations of the proposed cannabis cultivator, as will be conducted at the proposed facility; and
local approval is required in New Jersey cannabis
The submission of proof of local support for the suitability of the location, which may be demonstrated by a resolution adopted by the municipality’s governing body indicating that the intended location is appropriately located or otherwise suitable for activities related to the operations of the proposed cannabis cultivator.
A community impact, social responsibility, and research statement, which may include, but shall not be limited to, the following:
A community impact plan summarizing how the applicant intends to have a positive impact on the community in which the proposed cannabis establishment, distributor, or delivery service is to be located, which shall include an economic impact plan and a description of outreach activities;
A written description of the applicant’s record of social responsibility, philanthropy, and ties to the proposed host community;
A written description of any research the applicant has conducted on the adverse effects of the use of cannabis items, substance abuse or addiction, and the applicant’s participation in or support of cannabis-related research and educational activities; and
A written plan describing any research and development regarding the adverse effects of cannabis, and any cannabis-related educational and outreach activities, which the applicant intends to conduct if issued a license by the commission.
A workforce development and job creation plan, which may include information on the applicant’s history of job creation and planned job creation at the proposed cannabis establishment, distributor, or delivery service; education, training, and resources to be made available for employees; any relevant certifications; and an optional diversity plan.
New Jersey cannabis business plan,with financial data, also includes the following:
-
- An executive summary of the applicant’s business plan;
- A demonstration of the applicant’s financial ability to implement its business plan, which may include, but shall not be limited to, bank statements, business and individual financial statements, net worth statements, and debt and equity financing statements; and
- A description of the applicant’s plan to comply with guidance pertaining to cannabis issued by the Financial Crimes Enforcement Network under 31 U.S.C. s.5311 et seq., the federal “Bank Secrecy Act,” which may be demonstrated by submitting letters regarding the applicant’s banking history from banks or credit unions that certify they are aware of the business activities of the applicant, or entities with common ownership or control with the applicant, in any state where the applicant has operated a business related to personal use or medical cannabis.
- Whether any of the applicant’s majority or controlling owners were previously approved by the commission to serve as an officer, director, principal, or key employee of an alternative treatment center or personal use cannabis establishment, distributor,17or delivery service, provided any such individual served in that capacity for six or more months
- Any other information the commission deems relevant in determining whether to grant a license to the applicant.
If you need more information about the licensing process, it is recommended that you contact an expert on the field so that you can get the necessary guidance in your endeavor.
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Canopies for the Cultivation Licensees are Tiered in NJ
Pursuant to the latest legislation on the matter, the commission shall adopt rules or regulations restricting the size of mature cannabis plant grow canopies at premises for which a license has been issued to a cannabis licensee. In this sense, when adopting rules and regulations the CRC has to consider whether:
Limit the size of mature cannabis plant grow canopies for premises where cannabis is grown outdoors and for premises where cannabis is grown indoors in a manner calculated to result in premises that produce the same amount of harvested cannabis leaves and harvested cannabis flowers, regardless of whether the cannabis is grown outdoors or indoors; or
Adopt a tiered system under which the permitted size of a cannabis cultivators’ mature cannabis plant grow canopy may increase or decrease at the time of licensure renewal in accordance with that tiered system, except that the permitted size of a cannabis cultivator’s mature cannabis plant grow canopy may not increase following any year during which the commission disciplined the cannabis cultivator for violating a provision, rule or regulation provided by the legislature; or
Take into consideration the market demand for cannabis items in this State, the number of persons applying for a license and to whom a license has been issued pursuant to those sections, and whether the availability of cannabis items in this State is commensurate with the market demand.
NEW JERSEY MARIJUANA LAWS
NEW JERSEY CANNABIS LICENSES
- HOW TO GET A CANNABIS BUSINESS LICENSE IN NEW JERSEY
- HOW TO OPEN A DISPENSARY IN NEW JERSEY
- NEW JERSEY CANNABIS MICROBUSINESS LICENSE
- NEW JERSEY CULTIVATION LICENSE
- NEW JERSEY CANNABIS MANUFACTURER LICENSE
- NEW JERSEY CANNABIS WHOLESALER LICENSE
- NEW JERSEY CANNABIS DISTRIBUTOR LICENSE
- NEW JERSEY CANNABIS RETAILER LICENSE
- NEW JERSEY CANNABIS DELIVERY LICENSE
- NEW JERSEY CONDITIONAL CANNABIS LICENSE
- NEW JERSEY INITIAL RULES FOR THE ADULT USE CANNABIS MARKET
New Jersey Cannabis License Restrictions
At this time, the total number of licenses that will be available in New Jersey has not been determined. However, the current legislation limits New Jersey cultivation licenses to 37 over the first 24 months, which includes any alternative treatment centers deemed to be eligible for a New Jersey Cultivation license. However, this limitation does not apply to cannabis cultivator licenses issued to microbusinesses
Further, for a period of 24 months after the effective date of the legislation it is unlawful for any owner, part owner, stockholder, officer, or director of any corporation, or any other person engaged in any retailing of any cannabis items to engage in the growing of, testing of manufacturing of, wholesaling of, or transporting in bulk any cannabis items, or to own either whole or in part, or to be a shareholder, officer or director of a corporation or association, directly or indirectly, interested in any cannabis cultivator.
This basically means that, if you own a cannabis dispensary in New Jersey, you won’t be able to have a controlling interest in any cannabis cultivation operation.
Finally, at least 10 percent of the total number of licenses and conditional licenses shall be designated for and only issued to microbusinesses. After the initial period during which the number of licenses is capped, the commission shall review the current number of licenses issued and, provided there exist qualified applicants, the commission shall issue a sufficient number of licenses to meet the market demands of the State of New Jersey.
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